SUPREME COURT NOTEBOOK: Chief justice sells Pfizer stock to take part in two high court cases

By Mark Sherman, AP
Wednesday, September 29, 2010

Pfizer stock sold, Roberts to hear company’s cases

WASHINGTON — Chief Justice John Roberts has sold his shares of Pfizer Inc., a move that allows him to participate in two pending Supreme Court cases involving the pharmaceutical maker.

Federal law requires judges to sit out cases if they own even a single share of stock in any of the parties to a lawsuit. In the past, Roberts has not taken part in cases involving Pfizer because he owned less than $15,000 of the company’s stock, according to his latest report of personal finances, which covered 2009.

But when the court announced Tuesday that it had accepted an appeal from several drug makers, including Pfizer, in a dispute over prices charged public hospitals, there was no indication that Roberts would step aside from hearing the case.

Supreme Court spokeswoman Kathy Arberg confirmed that the chief justice sold his Pfizer shares in August.

As a result, he also will sit with his colleagues when they hear arguments Oct. 12 in another case involving childhood vaccines. Roberts played no role when the court decided in March to hear the case.

Arberg offered no explanation for Roberts’ decision to sell the stock now, but it appears likely that Justice Elena Kagan’s need to sit out the two cases played a role in Roberts’ timing.

Kagan, who joined the court in August, owns no stock in Pfizer, but was involved in the two cases at some point during her time at the Justice Department as President Barack Obama’s solicitor general.

Having one justice out of a case sets up the undesirable possibility of the rest of the court dividing 4-4. In such cases, the lower court ruling stands, but the Supreme Court sets no precedent to guide lower courts. In essence, it’s a waste of time for the court to have considered the case.

Senate Judiciary Committee Chairman Pat Leahy, D. Vt., introduced legislation Wednesday intended to keep the court at full strength, even when a justice is forced to step aside from a case. Leahy’s bill would allow the court to designate a retired justice, of which there currently are three, to fill in.

Retired justices already are allowed to sit in on other federal courts. Leahy said the idea was suggested to him by John Paul Stevens, just a few months before his retirement from the Supreme Court.

Even a 4-4 outcome, however, is preferable to the prospect of a 4-3 decision, which could result if two justices don’t take part in a case. In that instance, less than a majority of the nine-member court could render an important decision. On at least one other occasion, Roberts sold stock to avoid having a seven-justice court hear a case.

When the court hears arguments in a case, a justice who is not participating is nowhere to be found. The justice’s high-backed chair sits empty behind the court’s curved bench.

The newest justice will be absent more often than not when the court hears its first set of cases over the next two weeks. Because of her work as solicitor general, Kagan won’t take part in seven of the 12 cases the justices will take up in October.

She has so far taken herself out of 24 of the 51 cases on the court’s docket for the new term, leading former Attorney General Richard Thornburgh to joke that the court would begin its work “with the equivalent of eight and a half justices.”

Thornburgh acknowledged that Kagan’s recusal problem would be short-lived, and the numbers already appear to bear that out.

Before Tuesday, Kagan said she would not participate in 20 out of 38 cases. When the court announced Tuesday it would hear another 13 cases, Kagan ruled herself out of just four of the new ones.

Acting in a class-action tobacco lawsuit from Louisiana, Justice Antonin Scalia last week displayed the broad but rarely used power of a single justice.

Scalia, a cigarette smoker himself, raised concerns about the legal rights of tobacco companies in extending for at least a few months his earlier order that relieves the companies of immediately paying $270 million for a smoking cessation program in Louisiana.

Noting national concern over the abuse of class-action lawsuits in state courts, Scalia said the companies might not be able to recover all their money if they ended up winning in the Supreme Court.

A Louisiana appeals court had a substantially different view of the 14-year-old case, noting that the plaintiffs are aging and dying at a significant rate.

The case went to Scalia because he oversees the 5th Circuit, which includes Louisiana.

Justices have the authority to act on their own to issue an order that blocks another court’s decision from taking effect, in cases that are being appealed to the high court.

However, they more often seek their colleagues’ views. A review of court records by The Associated Press found that the last justice to act alone for something other than a delay of a few days was Sandra Day O’Connor, in a 2002 case that involved the release of government documents.

In the Louisiana case, the companies lost their bid in state court to throw out the award or at least delay the payment. They want the high court to throw out the judgment against them, and will soon file a full appeal. If the court decides not to hear the case, Scalia’s order will end.

But he said that’s not likely to happen. Scalia said he’s reasonably confident that the necessary four justices will vote to hear the case and that it’s “significantly possible that the judgment below will be reversed.”

will not be displayed